‘Well run businesses are going down’ – London restaurants and bars fear new Covid rules will push more over the edge

‘Well run businesses are going down’ – London restaurants and bars fear new Covid rules will push more over the edge

London hospitality operators have been steeling themselves for the introduction of the government’s Tier 2 Covid regulations from midnight tonight. They come on top of the 10.00 pm national curfew for pubs, bars and restaurants and renewed work from home advice, which many already feared would push them to the brink.

London venue closures to date already include Jonathan Downey’s bar and members’ club Milk & Honey and his street food market Dinerama, The Ritz Club casino, the Ace Hotel in Shoreditch, the Ledbury restaurant in Notting Hill – which held two Michelin stars – Vanilla Black in Holborn, and City of London soul food restaurant The Fat Bear. These are on top of heavy losses across the casual dining sector. Celebrity favourite Le Caprice shut in June, with plans to reopen at another location. Simpson’s in the Strand is yet to reopen.

The Tier 2 rules, which ban people from mixing indoors with anyone outside their household or support bubble – in other words, no restaurant bookings or visits to the pub with friends or work colleagues – were yesterday branded “absolutely catastrophic, particularly for Central London” by UKHospitality CEO Kate Nicholls.

With food and drink venues facing multiple layers of restriction – and without government financial support if forced to close, as applies to Very High alert Tier 3 areas – co-founder of Hawksmoor Will Beckett told BBC London News, “that purgatorial stage is probably going to be a death knell for many places”.

Bar owner and gallerist Alex Proud, who estimates he has lost £5,000-10,000 worth of bookings since London’s move to Tier 2 was mooted, told On London about his experience on an online conference call during which chief executives of major pub groups said they were weeks away from bankruptcy, while government ministers sat “nodding their heads”.

Proud queried how hospitality curbs could make a difference to the virus case rate, given available evidence about the sector’s contribution to infections.”The insanity is that by their own statistics this will have no impact,” he said. “How can it? At the end of two weeks, do we lock down for three months?”

Jeremy King of restaurant group Corbin & King said this morning: “It is another knee-jerk, ineffective, window dressing, butt-covering initiative that will have no real effect other than to temporarily suppress the numbers before they erupt again – and of course put operators and staff into further financial hardship.” He added: “Combined with ‘Don’t go to work’, ‘Don’t use Public Transport’, the curfew and extended Congestion Charge, it will hasten the end of more restaurants & bars – not the virus.”

Rob Star of Electric Star Pubs, which has six venues in London, said: “Obviously bookings will cancel, walk-ins will reduce and turnover will fall, making more and more businesses unviable. I imagine this is just the warning that we will be in full lockdown very soon, which I believe is completely unjustified and catastrophic for businesses.”

Exactly what pattern of behaviour will emerge under the new rules is uncertain, as venues have no way of being certain if a group of people are from the same household or support bubble. Chairman of L’Escargot and industry veteran Brian Clivaz told On London: “As restaurateurs, we have always been discreet if a gentleman comes in with his ‘wife’. I think the same kind of thing will happen with people in their bubbles.

“People will also have to make a balance between being good and being naughty. And in Soho, naughty has always been nice”. Nevertheless, Clivaz admitted that the arrival of Tier 2 had left the trade “in a bit of shock,” after hopes of a pre-Christmas recovery, and that he has had “hundreds” of covers cancelled.

LBC broadcaster Julia Hartley-Brewer tweeted that she had received messages from “good, law abiding citizens who obeyed every rule during the first lockdown – who say they have no intention of sticking to the new Tier 2 rule”, while comedian Kate Smurthwaite argues that “when the only rule change is one that they literally cannot police effectively I fail to see it will make much difference.”

Tim Foster, co-founder of Yummy pubs, which has three London venues, and who who describes himself as “always the optimist,” says, “We will see how we get on investing in outside space!” Bar entrepreneur Edmund Weil says, “I think many venues will take a fairly light touch approach to these rules. However, even a moderate degree of compliance by the public would be enough to plunge most venues into the red if they were not already there”.

Previous local lockdown rules in the North of England, which have prevented people from different households going to pubs, bars and restaurants together since the summer, seem in many cases to have been laxly observed, and have caused confusion because of the variations between different places.

William Lees-Jones, MD of Manchester-based brewery and pub company J W Lees, has reopened all the group’s 152 pubs and hotels despite describing the rules as “a nightmare”. He suggests there are cultural differences around people’s likelihood to visit the pub with family in London compared to Manchester, which may leave the capital’s venues more at risk from loss of trade under Tier 2.

Yesterday’s announcement that London is to be placed in Tier 2 – the High alert category (the middle of three levels), having been initially designated Medium alert (the lowest level) –  follows widespread industry anger at the government’s lack of hard evidence justifying the 10.00 pm curfew and scenes of street mass gatherings and crowded public transport due to all venues closing at the same time. There was a social media storm on the second weekend of curfew over a £1,000 fine for an Ilford burger bar that delivered a customer their order at 10.04 pm.

Kate Nicholls told the Treasury Commons Select Committee this week she forecast the impact on the sector would cause 560,000 job losses nationally by the end of the year, translating to around 100,000 in London if evenly distributed. Greene King, which operates 71 pubs in and around the capital, announced last week it was cutting 800 jobs.

“Mental health in the trade is poor at the moment,” says Nicholas Robinson, managing editor of pub trade publication Morning Advertiser. The Chancellor’s new Job Support Scheme, which begins next month, requires employers to pay staff not to work, leading hospitality business owners to wonder whether the scheme has been designed to minimise take-up.

Rob Star says Electric Star Pubs’ various landlords in East London, Lewisham and King’s Cross have ranged from “understanding” to “stubborn” about rent payments. Andrew Hilton of the Centre for the Study of Financial Innovation warns that despite deep pockets, the Corporation of London has chivvied tenants when it ought to be flexible.

British Kebab Awards founder and Lambeth councillor Ibrahim Dogus, who owns three Waterloo restaurants, says there are many restaurateurs in his network with “good, viable businesses for 10, 15, 20 years now struggling without direct support”. Edmund Weil identifies a swathe of mid-sized businesses with large wage and rent bills that are vulnerable: “Well-run businesses are going down – people who have done everything right for years.”

So far the public has strongly backed restrictions. Last month, 78% told YouGov they supported the Prime Minister’s raft of new measures, while a poll this week found 40% thought the three tier system doesn’t go far enough, compared to only 15% who believes it goes too far.

Some suggest the polls illustrate a gap between intentions and behaviour, with former Theresa May strategist James Johnson arguing in The Spectator that self-delusion is also at play. Adventure Bar’s Tom Kidd is among sceptics, saying “it’s like polling when people say they’re not going to vote Tory.”

In a deeply gloomy landscape, there are occasional bright patches. There have been new openings, including Nordic-Japanese retail, bars, restaurants and café complex Pan-Technicon in Motcomb Street, brasserie Maison Francois in St James’s, and the Galvin brothers’ new bistro and bar next to their fine dining restaurant La Chapelle in Spitalfields.

Asma Khan’s Soho restaurant Darjeeling Express reappears this month in Covent Garden in much bigger premises with a deli. Meanwhile, Luke Davis, CEO of SME investment firm IW Capital and a venue owner himself, calls for an extension of the Enterprise Investment Scheme to include hospitality, enabling businesses to access finance.

Operators will be hoping against hope that Centre for London’s Ben Rogers called it right when interviewed by the Telegraph last month: “London will not become a tumbleweed city.”

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